TMI Blog2016 (5) TMI 876X X X X Extracts X X X X X X X X Extracts X X X X ..... Zila Dugadh Utpadak Sahakari Sangh Limited [2011 (9) TMI 1080 - ITAT JAIPUR] - Decided in favour of assessee TCS U/s 206C - Non collection of tax at source on sale of scrap - Held that:- The Coordinate Bench has considered this issue in earlier years and held that this scrap has not been generated during the manufacturing process and circular noted by the ld CIT(A) is also not applicable on the given facts and circumstances of the case. Accordingly, we delete the addition made by the ld Assessing Officer and confirmed by the ld CIT(A) - Decided in favour of assessee - ITA Nos. 838 to 840/JP/2014, ITA Nos. 553 to 555/JP/2014 - - - Dated:- 16-5-2016 - Shri R. P. Tolani, JM And Shri T. R. Meena, AM For the Assessee : Shri P.C. Parwal (CA) For the Revenue : Shri Chanchal Meena (JCIT) ORDER Per Bench These are cross appeals being ITA Nos. 838 to 840/JP/2014 filed by the assessee and ITA Nos. 853 to 855/JP/2014 filed by the revenue arise against the order dated 13/10/2014 of the ld CIT(A)-III, Jaipur for A.Y. 2011-12 to 2013-14. The effective grounds of the assessee s appeal for A.Y. 2011-12 are as under:- 1 The Ld. Commissioner of Income Tax (Appeals) h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of TDS/TCS at the office premises of Sikar Jhunjhunu Dugdh Utpadak Sahakari Sangh Ltd.. The ld Assessing Officer noticed that the assessee had made payment of ₹ 1,3222,045/- on account of milk purchase difference in A.Y. 2011-12, ₹ 1,77,66,242/- in A.Y. 2012-13 and ₹ 1,13,55,795/- in A.Y. 2013-14. However, no TDS has been deducted by the assessee. The assessee was given reasonable opportunity of being heard on this issue, which was replied by the assessee vide letter dated 13/3/2013, which has been reproduced by the Assessing Officer on page No. 12 of the impugned order. It is contended that this issue has been examined in detail by his predecessor, in view of that, this is the payment to principal to principal hence no element of commission. The ld Assessing Officer considered the order of the Assessing Officer in assessee s case for F.Y. 2009-10 and CIT(A) order for F.Y. 2008-09 order dated 28/1/2013 wherein it has been held that payment made by the deductor to milk societies (DCS) and (PDCS) was in nature of commission/brokerage, which attracted the provisions of Section 194H of the Act. He again considered the definition of commission or brokerage provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es alongwith fixed margin called milk price difference is only a payment towards purchase of milk and not a payment of any commission or brokerage, which includes cost of milk and services provided directly to the assessee but commission is paid separately to the person, who is acting on behalf of the owner of goods or provided of services. He also submitted that the assessee s case is not came U/s 194H of the Act. He further relied on the following case laws:- (i) Bhopal Sugar Industries Ltd. Vs Sales Tax officer, Bhopal 1977 SCC (3) 147. (ii) Allahabad Bank Vs. ITO (2015) 152 ITD 383 (Agra) (Trib) (iii) ICICI Bank Ltd. Vs DCIT 90 DTR 401 (Lucknow) (Trib). (iv) Thomas Muthoot Vs. DCIT 80 DTR 33 (Coch.) (Trib) Therefore, he prayed to delete the addition confirmed by the ld CIT(A) in all the years. 6. At the outset the ld DR has vehemently supported the order of the ld CIT(A). 7. We have heard the rival contentions of both the parties and perused the material available on the record. The Coordinate Bench has considered the identical issue in ITA No. 277/JP/2013, ITA No. 382/JP/2013, ITA No. 87/JP/2015 and ITA No. 96/JP/2015 for A.Y. 2008- 09 and 2011 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... noted by the ld CIT(A) is also not applicable on the given facts and circumstances of the case. Accordingly, we delete the addition made by the ld Assessing Officer and confirmed by the ld CIT(A). Now we are deciding the revenue s appeal 12. The revenue is against allowing the appeal by the ld CIT(A) by holding that the margin of distribution in the payments made by the assessee to its distributor is not commission liable for deduction U/s 194H of the Act in all the years. The ld Assessing Officer has observed that the assessee had paid commission to the distributors at ₹ 1,35,28,711/- in A.Y. 2011-12, ₹ 1,69,25,223/- in A.Y. 2012-13 and ₹ 1,56,49,706/- in A.Y. 2013-14. Ld Assessing Officer further observed that the assessee sold milk through the retailer and paid the commission to the distributor as the assessee transported the milk from plant to retailer and overcoming the problems of tampering, pilferage and loss of weight during transportation. The margin provided to the distributor agents is nothing but the commission. Further the CBDT vide circular NO. 619 dated 04/12/1991 has clarified that retention of commission by agent amounts to constructing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT(A), who had allowed the appeal by observing that there was an agreement between the assessee and the distributors. These distributors, subsequently supplied milk through various retailers and while making such supply to the retailers the distributors add a specific margin amount to be retained by the distributors, which is as per Assessing Officer is a commission and liable to deduct TDS. The Hon ble ITAT in the case of ACIT (TDS) Vs Jaipur Zila Dugdh Utpadak Sahakari Sangh Ltd. in ITA No. 203 204/JP/2011 for A.Y. 2007-08 and 2008-09 order dated 02/9/2011 and decision in the case of Ajmer Zila Dugdh Utpadak Sangh Ltd. 30 DTR 418 has held that supply of mill and mill product by the assessee to the distributor was a sale agreement and on principal to principal basis and the assessee deductor was not liable for tax to be deducted at source U/s 194H of the Act. He has reproduced the finding of both the cases on page Nos. 33, 34 and 35 of the appeal order and by following the decision of the Hon ble ITAT, he deleted the addition. 14. Now the revenue is in appeals before us. The ld DR has vehemently supported the order of the Assessing Officer and at the outset, the ld AR of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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